Ocean Thermal Energy Conversion

Diagram of Offshore OTEC Facility (Click to Enlarge Image)

Ocean thermal energy conversion (OTEC) is a marine renewable energy technology that uses the temperature gradients in the ocean to generate a baseload, or constant, source of electricity. Other renewable energy sources such as wind and wave energy, are intermittent sources of electricity, meaning that the amount of electricity they generate may be variable due to weather conditions.

OTEC technology uses the temperature differential between the deep cold and relatively warmer surface waters of the ocean to generate electricity. The technology is potentially viable in tropical areas where the year-round temperature differential between the deep cold and warm surface waters is greater than 20 degrees Celsius (36 degrees Fahrenheit). In addition to generating electricity, OTEC has the potential to produce other products such as potable water, hydrogen, and ammonia. The cold water can also be used for other commercial products such as water air conditioning and aquaculture. For more information visit Resources.

Licensing of OTEC Facilities
NOAA's Office of Ocean and Coastal Resource Management is responsible for licensing ocean thermal energy conversion (OTEC) projects. OTEC demonstration projects do not need to receive a NOAA license but must be designated as a demonstration project by the Department of Energy.

NOAA's OTEC Licensing Authority
In 1980, the Ocean Thermal Energy Conversion Act granted the authority for licensing OTEC facilities located within the territorial sea of the United States to the Administrator of the National Oceanic and Atmospheric Administration (NOAA).

At this time it was envisioned that OTEC technology would be producing 10,000 megawatts (MW) of electricity by 1999 which would power approximately ten million homes. Shortly after the OTECA Act was established, NOAA's Office of Coastal Resource Management (OCRM) established an OTECA program and in 1981, promulgated regulations.

By 1996, NOAA had not received any license application for a commercial OTEC facility. During the fifteen year time period, the risks to potential investors and low oil prices have limited commercial development. NOAA disbanded the OTECA licensing program and the OTEC regulations were rescinded (click here to view the record of the OTEC regulations removed in the Code of Federal regulations).

In 2008, oil prices rose again and several companies approached NOAA with questions about licensing requirements for OTEC facilities. Since then, millions of dollars have been invested by private companies in OTEC project planning and design. Applications for pilot and commercial facilities are expected in the near future. In addition, both the Navy and Department of Energy have recently made substantial grant awards for OTEC component and subsystems development.

OCRM is now rebuilding its OTEC licensing capacity due to the recent interest in the technology.